Locally, our country fair is on, and the wife and I went last evening. We watched the pigs, goats, ducks, chickens, produce, flowers, and sheep get judged and awarded their respective ribbons. We even bought a shower head that filters out the chlorine supposedly. (Important. See Don’s Column for Friday) As the sheep went bah, bah, bah, I thought to myself; how stupid these animals are. Walking over to the steers, which were mostly beautiful angus, I realized that as stupid as a cow is, a sheep is far dumber.
A couple of weeks ago, I read of a European sheepman who went absolutely bust in a few quick minutes. One of his sheep leaped off a cliff, and 1400 others followed. The pile of dead sheep got so large at the bottom, that eventually the jumping sheep had a soft landing, and didn’t die, but he was ruined. Years ago, I saw the same thing happen in Colorado, but not to that degree. Ever notice that if a herd of sheep are running, and one decides to jump up, for no reason, the rest will automatically do the same, at exactly the same spot? While sheep do produce wonderful wool, and I have heard make wonderful barnyard pets for small children, because of their gentleness, they are so stupid as literally to jump off of a cliff, if the one in front of them does the same.
A lot of people use the word “sheeple,” to describe stupid people who follow the leader, no matter how dumb it may be. Perhaps it is a combination of “sheep” and “people,” huh? The sheep are a small portion of the livestock population of America’s or the world’s farms and ranches, but I suspect that the “sheeple,” are a great majority of the earth’s population! Think about it. It is my opinion, that aside from the Revolutionary War in America, we never should have been in any of the others. I am a patriot, but despise all the foreign wars our politicians have gotten us into. Sheeple continuously follow their leaders into fighting foreign wars, buying stocks, saving their dollars in bank savings accounts, buying whole life policies, buying homes at high prices, and the list is long.
Take any example you wish. Maybe autos. Is it true that if one buys a new car, and drives it around the block, it is worth maybe $10,000 less than its purchase price, because it is a “used car?” I think so, and that’s why I will never buy another new car in my life. It is logical not to do so.
Whole Life Policies? Don’t do that, because they don’t ever allow for inflation, and the dollars one saves, decline just like the rest. Buy term, if you need a life insurance policy. The sheeple love whole life policies, because they mistakenly believe they protect them for their old age. Nothing could be further from the truth. Insurance salesmen love to sell whole life, because they make a lot of commissions doing it.
Stocks? Well, it seems like everyone owns them. The stock market ups and downs are in every newscast. There have been more fines, frauds, and cheats in the various stock brokerages, than in practically any other industry. Probably more money has been lost in the stock market, than in any other form of investment. There are more guys in little cubicles, calling and trying to get the sheeple to buy this or that, than in any other industry. The Dow is in almost the exact same place it was in 1999, while gold and silver have gone from $288 to $428, and $4.21 to $7.22. Yet few buy gold and silver, which is real money. The sheeple lost an estimated $7 TRILLION when the market went bust four years ago, and they are buying again, even though it has P/E ratios of at least twice what they should be, for stocks to be at a true “buy” level.
Savings? You examine what the sheeple do, and tell me if it is wise or sheep like. Those big banks have trillions in savings from their sheeple customers. They are paying maybe 2% interest, which is taxable. The dollar, in which their savings is denominated, is probably losing its value at least twice the interest rate received. In other words, the sheeple are paying taxes on the interest earned, in a declining measuring device. If the inch, millimeter, mile, foot, gallon, liter, pound, volt, ampere, or acre lost value or substance every year, as the various paper currencies around the world do, it would be impossible for anything to be built. Constant values in measuring devices, is crucially important. We measure our wealth in dollars or euros, and they lose value each year. Yes, they’re printing the euro too. Our net worth or wealth, is one of life’s most important measurements, and yet the ruler by which everyone measures their wealth, shrinks in value each year. Does it make sense to save in a declining value measuring device, which are dollars, euros, pesos, etc? Hardly, but the sheeple do. I save in gold and silver, unlike the sheeple.
The real estate bubble is everywhere, and even the so called “experts” are beginning to realize it. In Denver, for several years, prices of homes went up an average of 17% per year. They are flat now. Other places are the same, or worse. Remember what it was like to ride up a hill on your bike, or lugging up a hill in an under-powered car? Slower and slower, till you finally reach the top, and then whizz downhill, is the scenario I am familiar with, and which is what all stock markets do when they approach the top. So why are sheeple still buying homes at outrageous prices? For the same reason they were still buying stocks just before the crash, even though the rise rate had diminished before the crash. They thought a new era had been discovered, and stocks would go on forever. This morning, on Bloomberg, a real estate guy was being interviewed, and his story was something to listen to, and shudder at its absurdity.
He said that people now had enough money to live away from the railroad tracks, and other undesirable places, and could pick where they wanted to live, which in his case was Hoboken, New Jersey. He said that since the wealthy could now afford to live in Hoboken, and since Hoboken was already sold out, prices would continue to go up. I have heard the same about Vail Colorado, where there is no more room, and older places are being demolished to make way for more expensive ones. These things may be true in Hoboken or Vail, but can this type of bubble last? Can real estate continue to go up, when tens of thousands are being laid off each month, and jobs are going overseas by the hundreds of thousands each year? With people being laid off in all income levels, from cotton mill workers to executives, can this phenomena remain in effect for long? Isn’t real estate approaching the top of the hill, only to go down the other side, as in a bike, train, or truck? I really do believe it, but the sheeple don’t, and they go on their merry way.
It has been said that if all the money could be divided up evenly, among all the population, within ten years, the same people would have it all over again, and those without, would be without again. I believe it. The sheeple would be on the low end, as they always are, because they just are too stupid to do otherwise. Sorry, but that’s the way I see it! And to think that this column got started with the braying of sheep at the local county fair. Protect yourself!